Aon plc has released its 2024 Global Medical Trend Rates Report based on insights from 113 Aon offices that broker, administer or advise on employer-sponsored medical cover.
The findings reflect the medical trend expectations of Aon professionals based on their interactions with clients and carriers represented in the portfolio of the firm’s medical plan business in each location. In the UK, the report forecasted the average medical trend rate for 2024 to be 15 percent, up from 8.5 percent in 2023.
The trend rate figures represent the percent increase in the cost of private health care – insured and self-insured – that are anticipated to be required to address projected price inflation, technology advances in the medical field and plan utilisation patterns.
The top medical conditions driving medical plan costs in the UK are:
- Musculoskeletal and Back Issues
- Cancer and Tumour Growth
- Mental Health
Rui Silva, vice president and medical trend leader in Health Solutions for Multinationals at Aon, said:
We have been in a period of remarkable inflationary conditions and economic volatility. Despite uncertainty on how long global inflationary pressures will last, it is clear from the locations surveyed that the medical trend rate will see a sharp rise in 2024 among employer-sponsored medical plans.
Rui Silva, medical trend leader in Health Solutions, Aon
Rachel Western, technical lead, Health Solutions at Aon, expressed her insights into the current state of private medical cover, noting that the UK is undergoing an unprecedented era. She emphasised the traditional role of private medical cover, working alongside the National Health Service (NHS). However, Western highlighted the well-documented challenges faced by the NHS, both in primary and secondary care.
Following the heightened health awareness post-pandemic, there has been a substantial increase in the utilisation of private medical services in the UK. This surge includes both self-pay options and utilisation through private medical schemes. Western pointed out that the use of virtual GPs is also on the rise, contributing to the complexity of healthcare pathways, as these virtual consultations often recommend private treatments. Moreover, the cost of treatment for certain conditions, particularly around cancer, has escalated due to technological and clinical advancements.
Western emphasised that the aftermath of delayed treatments during the pandemic has led to more complex states of treatment, contributing to rising medical inflation. These factors, combined with general inflationary costs driven by the current economic climate, have led to an all-time high trend rate in the UK, with no immediate signs of reduction.
In light of these challenges, Western suggested:
With rising trend rates, generally comes rising premiums. The key to managing these costs is to claim less, without reducing levels of cover, or those you cover. To get medical benefits working smarter, not harder, employers can focus on health and wellbeing strategies, particularly ensuring supportive preventative tools are implemented.
Rachel Western, technical lead, Health Solutions, Aon
Globally, Aon has forecasted the average medical trend rate for 2024 to be 10.1 percent, up from 9.2 percent in 2023 and the highest since 2015. The top medical conditions driving medical plan costs globally are:
- Cancer/Tumour Growth
- High Blood Pressure/Hypertension.
Read Aon’s 2024 Global Medical Trend Rate Report here.
Joanne is the editor for Workplace Wellbeing Professional and has a keen interest in promoting the safety and wellbeing of the global workforce. After earning a bachelor's degree in English literature and media studies, she taught English in China and Vietnam for two years. Before joining Work Well Pro, Joanne worked as a marketing coordinator for luxury property, where her responsibilities included blog writing, photography, and video creation.